The electrification of the transportation sector is crucial to reducing carbon emissions and tackling global climate change. In Latin America, the use of electric vehicles is growing, though their scale and impact remain limited. On September 2nd, the Latin America Clean Transport Forum in Mexico City convened representatives of the Mexican Government, NGOs and research institutions focused on clean transportation and private sector leaders in electric mobility, to discuss the outlook for the use of electric vehicles in the region.

According to the International Energy Agency, in order to limit average global temperature increases to 2°C – the critical threshold that scientists say will avoid dangerous climate change — by the year 2050, 21% of carbon reductions should come from the transport sector. To achieve this goal, three fourths of all vehicles sold by 2050 would need to be electric, including plug-in hybrid and battery electric vehicles. These projections would also require nearly full de-carbonization of the electricity sector through increased renewable energy generation.

Though there remain many challenges to expanding the use of electric vehicles, such as the high up-front costs, insufficient charging infrastructure, and concerns about the limited range that electric vehicles can drive without recharging, several countries have introduced measures that have proved successful in promoting EV uptake.

Indeed, at a global level, electric vehicle penetration has grown rapidly, albeit from a small base, thanks to a variety of new car models coming to the market, significant cost reductions in components such as batteries and a range of public policies that promote electric mobility. The total stock of electric vehicles more than tripled to 665,000 in 2014 from 180,000 in 2012.

Cities and countries looking to invest in infrastructure supporting electric vehicles can learn from California’s example, said Mark Duvall, Director of Energy Utilization at the Electric Power Research Institute. Establishing convenient charging infrastructure in residential areas is the most important step, he noted, as this allows potential buyers without a garage or space for a charging station in their home to purchase an electric vehicle. Employers can also promote EV adoption by installing charging stations for their employees to use.

Government incentives, such as local parking privileges, federal tax credits, state sales rebates and the ability to use high occupancy vehicle (HOV) lanes, have also played an important role in California’s comparatively high rate of EV adoption, said Tom Turrentine of the Institute of Transportation Studies at UC Davis, though more can be done to inform consumers about these benefits.

Indeed electrification of the transport sector is particularly important in Mexico, where transportation contributes 44% of national greenhouse gas emissions compared to an average of 28% globally, according to Vladimir Sosa of Mexico’s Federal Electricity Commission. The transport sector is also one of the least diverse in terms of energy sources. Globally, 93% of transport sector energy consumption is supplied by oil; in Mexico that number is over 97%.

Glenn Schmidt, Vice President of Government and External Affairs, Americas at BMW Group, noted that incentives for purchasing electric vehicles in Mexico – such as eliminating the new car tax at the federal level and removing the ownership tax – had helped promote EV adoption, but that more can be done to incentivize EV purchases in the country. Additional measures could include tax credits, free toll roads, public chargers and preferential parking, he suggested.

To date, the most important electric transport used in Latin America has been trains, noted Adriana Lobo, Director of CTS EMBARQ Mexico. While electric taxi fleets have been deployed in Mexico, Colombia, Chile, Brazil and Uruguay, she added, the number of vehicles involved has been small and more effort and planning must go into their expansion and maintenance.

Although EV deployment remains concentrated in a handful of countries, including the United States, Japan, China and several European countries, panelists concluded that in the long-term, electric vehicles — in combination with higher fuel efficiency standards for conventional cars, improved public transportation and better conditions for alternative modes of transportation, such as biking or walking — are a critical part of a clean transport agenda.

The Inter-American Dialogue engages our network of global leaders to foster democratic governance, prosperity, and social equity in Latin America and the Caribbean. Together, we work to shape policy debate, devise solutions, and enhance cooperation within the Western Hemisphere.